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False Claims

FALSE CLAIMS ACT – QUI TAM PROVISIONS

Qui Tam provisions of the False Claims Act allow private citizens to bring lawsuits on behalf of the federal government against greedy corporations defrauding the federal government. The False Claims Act was adopted in 1863 to combat rampant contractor fraud. Typical private persons bringing False Claims Act lawsuits are former employees and/or current employees of companies that are engaged in a scheme to defraud the federal government.

FALSE CLAIMS ACT 

31 U.S.C. 3729 imposes liability on an person who commits any of the following acts against the United State Government:

1.  Knowing presents, or causes to be presented, a false of fraudulent claim for payment or        approval;

2.  Knowing makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim;

3.  Has possession, custody, or control of property or money used, or to be used, by the Government and knowingly delivers, or causes to be delivered, less than all of that money or property;

4.  Is authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;

5.  Knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who lawfully may not sell or pledge property; or

6.  Knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government;

7.  Conspires to commit a violation of paragraphs (1) through (6) listed above.

31 U.S.C. 3729(a)(1) imposes civil penalties and three times the amount of damages which the United States Government sustains. Those damages may be reduced under 31 U.S.C. 3729(a)(2) if the person committing a violation of 31 U.S.C. 3729(a)(1) cooperates with official of the United States to not less than two times the amount of the damages sustained by the Government.

CIVIL ACTIONS BY PRIVATE PERSONS FOR FALSE CLAIMS:

31 U.S.C. 3730(b) allows private citizens to act as a “Relator” to bring a civil lawsuit on behalf of United States Government against any person violating 31 U.S.C. 3720(a)(1)(A) through (G). However, the private person bringing the action as a Relator on behalf of the federal government must be the original source of the information and lawsuit cannot be based on public disclosure of the information. The Relator must also be the first to file the lawsuit. Any such lawsuit must be filed under seal for at least 60 days and cannot be served on the Defendant until court so orders.

Once a Relator files suit on behalf of the United States against a defendant for violating the False Claims Act the Government may do any of the follow:

  1. The Government can decide to proceed with the lawsuit against the defendant and will have primary responsibility for prosecuting the action. The Relator has a right to continue as a party to the action subject to limitations;
  2. The Government may dismiss the action notwithstanding the objections of the Relator upon motion and hearing before the Court;
  3. The Government may decide not to proceed with the lawsuit and the Relator will have the right to proceed with the lawsuit. However, the Government still has the right to intervene at any time at a later date upon showing good cause.

AWARD TO QUI TAM PLAINTIFF:

A successful Relator (Qui Tam Plaintiff) can be awarded the following:

  1. If the Government proceeds with the action brought by the Relator, the Relator could receive at least 15% but not more than 25% of the proceeds of the action or settlement of the claim, depending upon the extent to which the Relator substantially contributed to the prosecution of the action.
  2. If the Government does not proceed with with the lawsuit against the defendant, the Relator could receive not less than 25% and no more than 30% of the proceeds of the action or settlement.

STATUTE OF LIMITATIONS FOR CIVIL ACTIONS:

Under 31 U.S.C. 3731(b) a civil action brought by a Relator under 31 U.S.C. 3730 must be brought within the longer of two periods:

  1. Six (6) years from the date on which the violation was committed, or
  2. Three (3) years after the date when facts material to the right of action are known or reasonably should have been known by the government charged with responsibility to act in the circumstances.

No claim may be brought more than ten (10) years after the date on which the violation is committed.

If you would like to learn more about your right to bring a False Claim Act claim against a person defrauding the federal government, contact Brian J. Graber, Ltd., at (312) 291-4648 for a free consultation.

FALSE CLAIMS ACT RETALIATION CLAIMS: 

The False Claims Act, 31 U.S.C. 3730(h)(1) provides a cause of action for retaliation for any employee, contractor, or agent discharged, demoted, suspended, threatened, harassed, or in any other manner is discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent or associated others in the furtherance of an action under 31 U.S.C. 3730(b) or stop 1 or more violations of this subchapter.

Under 31 U.S.C. 3730(h)(2) any employee, contractor, or agent subjected to retaliation in violation of 31 U.S.C. 3730(h)(1) may be entitled to the following remedies:

  1. Reinstatement with the same seniority status they would have had but for the discrimination;
  2. Two (2) times the amount of back pay, with interest on the back pay;
  3. Compensation for special damages sustained as a result of the discrimination, including litigation costs and reasonable attorney’s fees.

31 U.S.C. 3730(h)(3) limits the time to bring a retaliation claim under 31 U.S.C. 3730(h) to three (3) years after the date when the retaliation occurred.

If you would like to learn more about your rights under the False Claims Act to be free from retaliation, contact Brian J. Graber, Ltd., at (312) 921-4648 for a free consultation.